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Questions from my webinar on Intelligent Failure

I just wrapped up a webinar on the topic of failing by design, which is the subject of a recent artilce in the Harvard Business Review. There were some quite interesting questions asked during the course of the webinar, and I thought I would document them here for those that might have an interest but couldn't attend the webinar itself. The presentation on which the webinar was based is available for download at the "tools" page of this web site.

Q: How can an HR department support the idea of intelligent failing in conducting personnel reviews?

What I suggested was that the critical distinction that needs to be made is between bad luck and bad decision-making. The kinds of principles that you want to put in place are to make sure that people articulate what their assumptions are and then if things don't work out, make sure that they have contained the risk and understood why reality turned out to be different from expectations. it's also important that people not make the same mistake repeatedly – that's not intelligent!

Q: I am working on a technology project and the expectations are very high for it. How can I tell leaders and users that we need to be doing some experimentation so that we can learn as we go, how do I communicate that?

Here, the answer has to do with how the system (assuming it's a computer system) is being built. In the old classic waterfall methodology, requirements were developed by users and systems analysts, which would then be tossed over the transom to the technical people who would work on it and then by the time the users saw it next, it often bore little resemblance to what they actually wanted. Some people advocate a more flexible agile methodology, in which the system is designed iteratively and users give feedback all along the way – in effect, generating lots of small failures so that they can avoid the calamity of a substantial systems failure when it comes up. I do a lot of post-mortems of systems projects gone horribly wrong, and it is often the sequential nature of the design process that leads things to go astray.

Q: Do you have a template for what makes a failure intelligent?

Absolutely! You'll find the questions on the last page of the presentation from the webinar, which is available for download at the "tools" section of my web site.

Q: Organizations can tolerate lots of failures, but I don't think individual leaders could be successful if they failed 9 times out of 10.

Here, I would disagree. By comparison, think of scientists. Nobody expects a scientists' hypothesis to work out every time – after all, if you knew what the result would be there would be very little need for a scientific experiment. So scientists can fail 9 times out of 10 or even more, in the sense that their hypotheses were not supported, and nobody thinks that is odd in the least. But somehow when it comes to management, we have this Taylorist idea that everything should be predictable and anticipated in advance. Instead, we would be much better off if we acknowledged the risks of taking action and supported people who try and fail intelligently.

Q: Do you have an example of a CEO who has failed and overcome it?

Most CEO's have experienced failures along the way in their careers. Indeed, I think its highly dangerous to promote someone to an important position who has never had a failure – they won't know the warning signs and will likely make very poor decisions when the unexpected happens. Take an example we'd all be familiar with: Steve Jobs. Everybody forgives Apple their failures (indeed, hardly remembers them) because we love their products so much. Remember the cube? The rockr phone venture with Motorola? Or of course the Apple Lisa, the precursor to the McIntosh.

Q: How do you align strategy, resources and people in your company?

Oh, for that I use the opportunity portfolio concept from my book Discovery Driven Growth. The basic idea is to categorize initiatives in terms of how uncertain they are: core business, new adjacent businesses or options for the future. Then, you decide how many of what kind of projects your strategy requires. Then the best in class in each type compete with each other for resources – you don't want projects that are not alike to be fighting for the same resources. Then you manage people's careers so that they have exposure to the different types. It's a terrible idea to let people become senior leaders who have never worked in a new business area.

Q: Can you give an example of a company that embraces intelligent failure?

Absolutely – one of my favorites is United Parcel Service. Their CEO does a great job of making clear where it is OK to fail and where it isn't, for starters. They also make a point of learning from their failures and communicating the lessons. A very interesting company.

More questions? Send them along to me by email and I'll post the answers here!